Prelims

Half Title Page

International Financial Reporting Standards Implementation

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CONTRIBUTIONS TO INTERNATIONAL ACCOUNTING

Series editor: Mohammad Nurunnabi

About the series

Contributions to International Accounting (CIA) aims to bridge the gap between academic researchers and practitioners and deals with all areas of international accounting, including financial reporting, auditing, management accounting, and taxation. Due to the increasing globalisation and the mobilisation of business, this series recognises that international accounting is influenced by a variety of forces (political, social, economic, behavioural, and cultural) and hence is devoted to examining how developments in these areas affect the financial reporting and disclosure practices, taxation, management accounting practices, and auditing, as well as accounting education from global perspective. This series welcomes a broad view of the international accounting using variety of methodologies, including theoretical research, empirical research, applied research, and cross-cultural studies. The core mission of CIA remains publishing the highest quality research that is relevant to our times. All manuscripts submitted for publication will undergo double-blind peer review.

About the volume

The purpose of this inaugural volume of Contributions to International Accounting book is to address an important gap in literature because there still remains a lack of research on International Financial Reporting Standards (IFRS) implementation. With regard to the commitment to a single set of global accounting standards, nearly all of the jurisdictions (156 of the 166) have made a public commitment supporting a single set of high-quality global accounting standards as of 13 January 2021. The jurisdictions that require or permit the use of IFRS for domestic publicly accountable entities (PAEs; listed companies and financial institutions) constitute 54% of the gross domestic product (GDP) of all profiled jurisdictions. The 10 jurisdictions have not made a public commitment of IFRS, including Albania, Belize, Bermuda, Cayman Islands, Egypt, Macao, Paraguay, Suriname, Switzerland, and Vietnam. The 166 profiles include all 31 member states of the European Union and the European Economic Area, in which IFRS are required for all companies whose securities trade in a regulated market. The 2018 GDP of those jurisdictions require IFRS for all or most domestic PAEs totals US $39.474 trillion (https://www.ifrs.org/). This volume focuses on providing relevant and timely information for local and international policymakers.

Editorial Advisory Board

Distinguished Professor Lee D. Parker, School of Accounting, RMIT University, Australia

Professor Daniel O’Leary, USC Marshall School of Business, University of Southern California, USA

Professor Khaled Hussainey, Portsmouth Business School, Portsmouth University, UK

Professor Eva Jermakowicz, College of Business, Tennessee State University, USA

Professor Ayoib Che Ahmad, School of Accountancy, College of Business, Universiti Utara Malaysia, Malaysia

Professor Anne Fortin, Chair, Department of Accounting, Université du Québec à Montréal, Canada

Professor Ervin L. Black, Chair, John T. Steed School of Accounting, The University of Oklahoma, USA

Professor Nadia Albu, Department of Accounting, Auditing & Management, Bucharest University of Economic Studies, Romania

Professor Kıymet Tunca Çalıyurt, Department of Economics & Administrative Sciences, Trakya University, Turkey

Professor Michael Alles, Rutgers Business School, Rutgers University, USA

Professor Noor Azizi Ismail, Deputy Vice-Chancellor, Universiti Utara Malaysia, Malaysia

Professor Nehmé Azoury, Dean, Faculty of Business, Holy Spirit University of Kaslik, Lebanon

Professor Charles Richard Baker, Department of Accounting & Law, Adelphi University, USA

Title Page

International Financial Reporting Standards Implementation: A Global Experience

BY

MOHAMMAD NURUNNABI

Prince Sultan University, Saudi Arabia

United Kingdom – North America – Japan – India – Malaysia – China

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Emerald Publishing Limited

Howard House, Wagon Lane, Bingley BD16 1WA, UK

First edition 2021

Copyright © 2021 Emerald Publishing Limited

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No part of this book may be reproduced, stored in a retrieval system, transmitted in any form or by any means electronic, mechanical, photocopying, recording or otherwise without either the prior written permission of the publisher or a licence permitting restricted copying issued in the UK by The Copyright Licensing Agency and in the USA by The Copyright Clearance Center. Any opinions expressed in the chapters are those of the authors. Whilst Emerald makes every effort to ensure the quality and accuracy of its content, Emerald makes no representation implied or otherwise, as to the chapters’ suitability and application and disclaims any warranties, express or implied, to their use.

British Library Cataloguing in Publication Data

A catalogue record for this book is available from the British Library

ISBN: 978-1-80117-441-1 (Print)

ISBN: 978-1-80117-440-4 (Online)

ISBN: 978-1-80117-442-8 (Epub)

Dedication

For my mother who is my role model and for her endless support. Thank you for helping me to dream big in my life. Thanks for always being there for me.

Contents

About the Author

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Professor Mohammad Nurunnabi, PhD, CMA, SFHEA, FRSA, FAIA-Acad, CMBE, CPA is the Aide to the President on Research, Ranking and Internationalization, and Chair of the Department of Accounting at Prince Sultan University, Saudi Arabia. He is an Academic Visitor (Senior Member) of St Antony’s College, University of Oxford, Oxford, UK. Previously, he has taught in University of East London (UK), University of Bedfordshire (UK), and Edge Hill University (UK). Prior to his academic career, he worked as a financial team member in ADVFN Plc (covers in excess of 70 stock exchanges from across the globe), London, UK.

He holds a PhD with an outright pass (no corrections) from the University of Edinburgh, UK. He is a senior fellow of Higher Education Academy (SFHEA), UK, a Chartered Management Accountant (CMA), an academic fellow of the Association of International Accountants (FAIA-Acad), fellow of the Royal Society of Arts (FRSA), and Certified Management and Business Educator (CMBE). He is an academic member of the Institute of Management Accountants (IMA), European Accounting Association, British Accounting and Finance Association (BAFA), and American Accounting Association (AAA).

He has been active within the accounting profession and is a Vice President (Education) of the IMA Riyadh Chapter, Saudi Arabia, and a Global Advisory member of the Diversity Thought Leadership Pipeline Committee of the IMA, USA. Currently, he teaches Managerial Accounting for MBA programme. His current research interests include knowledge economy in the Middle East, tax evasion; Islamic accounting and Shariah governance; International Financial Reporting Standards (IFRS) adoption and implementation; politics, regulation, and enforcement; corporate governance; intellectual capital reporting; management accounting change; theory of the role of the state, Max Weber and accounting policy; financial reporting; accountability; internal control; journal ranking; culture and IFRS; accounting curricula; corporate disclosure; corporate social responsibility and Islamic values; corruption and accounting development; governance in higher education; and internationalisation in higher education.

His most recent book is The Role of the State and Accounting Transparency (Routledge: London and New York). He has published over 130 articles in international journals including ABDC Ranked, ERA Ranked, ABS Ranked, and Scopus/ISI indexed. His paper was ranked first in 2014, 2015, and 2016 as the most downloaded published articles in Research in Accounting Regulation. He currently serves as Editor-in-Chief of PSU Research Review: An International Journal, Emerald, and Series Editor-in-Chief of Contributions to International Accounting. He serves on the editorial boards over 20 journals. In addition, he is regularly reviewing books for Routledge, UK, and John Wiley & Sons, Inc., USA, and conference reviewers (Strategic Management Society – SMS). He is also the reviewer of 97 leading international journals including Journal of Business Ethics, Journal of Business Research, Journal of International Business Studies, Organization & Environment, Development and Change, Polity, Critical Perspectives on International Business, Corporate Governance: An International Review, Accounting Horizons, Accounting Education: An International Journal, Journal of Accounting and Public Policy, Accounting, Auditing & Accountability Journal, Journal of Asia-Pacific Business, Critical Asian Studies, and International Journal of Emerging Markets. He has also presented papers in international conferences including AAA, BAFA, Irish Accounting and Finance Association, Financial Reporting and Business Communication Conference, Scottish Doctoral Colloquium in Accounting and Finance, and The Institute of Chartered Accountants of Scotland.

He has received numerous prestigious researches and teaching awards including Prince Sultan University President’s Distinguished Research Award (2020); the IMA Faculty Leadership Award from IMA, USA, in 2017; ‘Outstanding Research Certificate’ (2015); Certificate of Appreciation on ‘Financial Leadership and Reporting’ from Association of Chartered Certified Accountants (ACCA) (2014); Recognition of ‘Outstanding Service as an IMA Campus Advocate’ from IMA, USA, in 2014; and ‘Academic Excellence in Research and Teaching’ Award from Channel S, UK-based TV Channel in 2013. He was awarded a Platinum Lever Leader by the IMA in 2019. He has significantly contributed to G20 Saudi Arabia and principal investigators for several policy papers. He is also conducting policy papers with The United Nations Conference on Trade and Development and The International Federation of Accountants. He is a regular invited speaker for international conferences and policy forums. He is also a regulatory reviewer of government regulations on SME in Saudi Arabia.

He is one of the founding leaders of the Global SME Policy Network. He is contributing to policy issues on global SME, tax, IFRS, and labour market.

Acknowledgements

I wish to express my profound gratitude to the Almighty Allah (subhana wa taala) for giving me the strength and ability to complete this book successfully. I would like to express my deepest gratitude to Dr Ahmed Yamani (President, Prince Sultan University) and Dr Saad A. Almosa (Dean of the College of Business Administration, Prince Sultan University) for providing me essential support in this project.

I must thank the five research assistants – Awan Mohammad A. Alarifi, Adwa Mohammed S. Alraja, Rawan Abdullah S. Aburas, Sarah Abdulkarim H. Alsadoun, and Arwa Ali A. Alduaij – who helped with data collection.

I am also indebted to my parents, my colleagues, friends, and all of whom have always been patient, understanding, and inspired me. Finally, I would like to thank the publishing team at Emerald Publishing, in particular, Fiona Allison (Books Commissioning Editor BME) for her continuous cooperation throughout this project.

Preface

Based on the extensive literature, this book offers an important aspect that analyses the various issues related to International Financial Reporting Standards (IFRS) implementation. This book is an invaluable source for undergraduate final year accounting students (Advance Accounting/International Accounting/IFRS), masters (MSc Accounting and Finance, MSc in International Accounting, MRes in Accounting, and Master in Professional Accounting) for postgraduate research courses, and PhD/doctoral-level students.

This book also aims to assist policymakers (at local level, regional level, and international level), namely the International Accounting Standards Board, World Bank, International Monetary Fund, the United Nations Conference on Trade and Development, and G20 countries with necessary insights about financial reporting environment.

The purpose of this inaugural volume of Contributions to International Accounting (CIA) book is to address an important gap in literature because there still remains a lack of research on IFRS implementation. With regard to the commitment to a single set of global accounting standards, nearly all of the jurisdictions (156 of the 166) have made a public commitment supporting a single set of high-quality global accounting standards as of 13 January 2021. The jurisdictions that require or permit the use of IFRS for domestic publicly accountable entities (PAEs; listed companies and financial institutions) constitute 54% of the gross domestic product (GDP) of all profiled jurisdictions. The 10 jurisdictions have not made a public commitment of IFRS, including Albania, Belize, Bermuda, Cayman Islands, Egypt, Macao, Paraguay, Suriname, Switzerland, and Vietnam. The 166 profiles include all 31 member states of the European Union and the European Economic Area, in which IFRS are required for all companies whose securities trade in a regulated market. The 2018 GDP of those jurisdictions require IFRS for all or most domestic PAEs totals US $39.474 trillion (https://www.ifrs.org/). This volume focuses on providing relevant and timely information for local and international policymakers.

This book addresses the implementation of IFRS issues to ensure that readers are aware of recent thinking and development, focussing on their relevance to application, with enough detail to explain: ‘Introduction – International Financial Reporting Standards (IFRS): Where We Are Now?’ (Chapter 1), ‘Implementation of International Financial Reporting Standards (IFRS) in Developing Countries’ (Chapter 2), ‘The Cultural Impact of International Financial Reporting Standards (IFRS) Implementation’ (Chapter 3), ‘The Economic Impact of International Financial Reporting Standards (IFRS) Implementation’ (Chapter 4), ‘Disclosure, Transparency, and International Financial Reporting Standards’ (Chapter 5), ‘Theory of International Financial Reporting Standards (IFRS) Implementation’ (Chapter 6), and ‘Antecedents of IFRS Adoption in BRICS Nations: A Meta-synthesis’ (Chapter 7).

I appreciate your taking time to read this note. I encourage your questions or comments or feedback, please contact me at: mnurunnabi@psu.edu.sa or s_agor2001@yahoo.com

Professor Mohammad Nurunnabi, PhD, CMA, FAIA(Acad), SFHEA, FRSA, CMBE, CPA

Chair, PSU Institutional Review Board (IRB)

Editor-in-Chief, PSU Research Review: An international Journal (PRR)

Aide to the President on Research, Ranking & Internationalization

Chair, Department of Accounting

Prince Sultan University, Riyadh, Saudi Arabia

E-mail: mnurunnabi@psu.edu.sa

14 February 2021